Is housing the reason for Comcast’s rebound?

Comcast’s announcement this week that video subscriber growth resumed late in 2013 after a multi-year drain drew cheers from investors who bid up the stock and praise from the prominent industry analyst Craig Moffett, who proclaimed Comcast has unseated DirecTV as the proud provider of the best pay-TV experience in the U.S.

Comcast’s chairman Brian Roberts told a Citigroup media investment conference in Las Vegas that Comcast would report a video subscriber gain for the final three months of the year, reversing a six-year trend. Comcast shares rose to $52.80 from $51 Tuesday on the news.

Comcast’s investment in a richer VOD service and an improved video navigation system appear to be catching on with customers, contributing to improved retention that helps staunch the bleeding. But beyond the improvements Comcast is making to its video service, another contributor to growth deserves some of the credit: the U.S. housing market.

The fourth quarter was shaping up as the best in five years for U.S. housing starts, the statistic that tracks net gains to U.S. housing inventory. The December numbers aren’t yet in, but November housing starts rose 22.7%, reaching an annualized rate of 1.09 million new homes. More import, housing completions – describing homes that are ready for move-in – improved through November to an annualized rate of 833,000.

Housing starts translate over time to new prospective customers for everyone from cable companies to lawn services, and their absence from the scene since the 2007 recession is a big reason the pay-TV category at large has been flat. With no net gain in serviceable households, providers are left battling to divide customers in a zero-sum marketplace. Roughly 800,000 new, completed homes is a relatively minor addition to a pool of close to 115 million U.S. TV homes (Nielsen), but for pay-TV providers that have seen nothing but a flat or shrinking market lately, it’s sure better than nothing.

Comcast, with a significant presence in Texas, Colorado, California, Utah and the northwest is well-positioned to benefit from the housing rebound, which is strongest in the southern and western U.S., regions that accounted for roughly two-thirds of projected annual completions through November.

News of a welcome respite to the housing slump is not to diminish Comcast’s Q4 achievement, which may well represent the start of a growth comeback in the video category. But it’s too soon to tell exactly how meaningful an upward tick may be. Time Warner Cable already has reported it will post a video subscriber loss for Q4, suggesting Comcast could buck the wider trend. But if most of the other big players – AT&T, DirecTV, Dish Network, Charter Communications and Verizon – collectively eke out video gains, it suggests one big influence on the market isn’t a sweet navigation interface or a better VOD library, but the return of a long-lost fundamental: more customers to chase.